Metacafe Edging Closer to Acquisition

For second time in less than a week we have been forced to ask the question: deal or no deal? Recently there has been escalating talk about Metacafe being acquired for close to $200 million, with Yahoo as the likely suitor for the company.

Today, Techcrunch is reporting that the deal may have fallen through, due to concerns over Metacafe’s content and traffic. The reality, at present, is somewhere in the middle.

Our sources, some close to Metacafe, say that the negotiations are continuing and Yahoo is one of the likely suitors. Nothing has been finalized as yet, though the tone of our sources regarding the closure of a deal is much more solid today than over the past couple weeks. While other prospective buyers maybe in the mix, Yahoo’s name keeps cropping up in our reporting.

Regarding concerns about Metacafe’s traffic, the November comScore numbers cited by TechCrunch, which indicate a 25 percent unique visitor drop from September to November, are not replicated across other analytics services. Alexa shows upward growth, as does Hitwise (see chart below). However, we consider this a side note as web measurement is notoriously problematic.

Metacafe and Yahoo officials both declined to comment. Please stay tuned for more details.